Peacock seeks revamped Big W deal

DISCOUNT fashion retailer Peacocks looks set to tighten its grip on the clothing operations of Woolworths' out-of-town Big W stores.

Woolworths, led for the past seven months by chief executive Trevor Bish-Jones, is in advanced negotiations aimed at changing the terms of the deal under which Peacocks supplies clothing sold through the Big W outlets.

The contract runs until 2005. But Bish-Jones wants to rejig it because Big W has found that it is suffering large stock losses. It is having to make big mark-downs on the merchandise that it cannot sell at full price and then has to sell off at a discount.

No new deal has yet been struck between Woolworths and Peacocks. But it is understood that the two sides are moving towards an agreement that would give Peacocks far greater control over the Big W clothes operation. Rather than simply supplying batches of clothing to Big W and giving up all control, Peacocks would have more power over the merchandising and pricing of goods.

In return, it would shoulder part of the responsibility for clothes that do not sell, or whose prices have to be cut. It is thought that the two sides should be able to sort out a deal within weeks.

Peacocks, headed by Richard Kirk, has so far said only that it is 'in negotiations with Woolworths about a number of mutually beneficial changes to its supply contract linked to the future expansion of Big W'. But the company has said that any changes should not have a significant impact on the cash contribution from the Big W tie-up.